Want to help startups? Just give them money
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Want to help startups? Just give them money
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Re: Want to help startups? Just give them money
#2Is there no equivalent of the NW Fund in Scotland?
http://www.thenorthwestfund.co.uk/
Re: Want to help startups? Just give them money
#3This feels like a One More Level of Indirection solution. [1]
The problem, I think most everyone agrees, is that the government isn't the greatest at growing businesses. The obvious, delete-all-the-code approach would be to leave more money in the hands of the businesses by lowering taxes.
Or, as the article suggests, we could pile on another layer of indirection: encourage the government to keep taking my money, hope they're halfway decent at identifying smart startups (which I'm sure they would be, the government is awesome at everything else they do right?), and, wonder of wonders, they identify the next Facebook 9 times out of 10, we still have to lose a significant percentage of the wealth to paperwork, inefficiencies, and bureaucracy.
> I’d be confident that I could do more for my startup, Plantedd, with whatever equivalent amount spent by government organisations to pay consultants to help us with marketing or IT or training.
Dude, I'd love that. Plantedd looks stellar. I think we want the same things. I also think it's far more straightforward to lobby for more tax breaks for startups and call it a day.
Re: Want to help startups? Just give them money
#4Is there no equivalent of the NW Fund in Scotland? http://www.thenorthwestfund.co.uk/
We've got things like the West of Scotland Loan Fund and similar schemes. The equity or loan funding support is better, but there's still essentially a large degree of inefficiency and a lack of effectiveness in the process because you've got teams making decisions on who to pick without the benefit of any randomised evaluation, so you're not gathering any objective data on what's actually effective.
Re: Want to help startups? Just give them money
#5This feels like a One More Level of Indirection solution. [1] The problem, I think most everyone agrees, is that the government isn't the greatest at growing businesses. The obvious, delete-all-the-code approach would be to leave more money in the hands of the businesses by lowering taxes. Or, as the article suggests, we could pile on another layer of indirection: encourage the government to keep taking my money, hop…
(The One Direction solution??)
I agree that more tax breaks for startups would help and it would be a more straightforward thing to achieve. The two things don't have to be mutually exclusive though, so I'd say we need both. For early-stage startups though, sometimes the challenge is more in actually reaching the stage where there's anything to tax - which is why I still think actually giving them the money in their pockets is vital.
Thanks for the compliment about Plantedd!
Re: Want to help startups? Just give them money
#6This feels like a One More Level of Indirection solution. [1] The problem, I think most everyone agrees, is that the government isn't the greatest at growing businesses. The obvious, delete-all-the-code approach would be to leave more money in the hands of the businesses by lowering taxes. Or, as the article suggests, we could pile on another layer of indirection: encourage the government to keep taking my money, hop…
(The One Direction solution??) I agree that more tax breaks for startups would help and it would be a more straightforward thing to achieve. The two things don't have to be mutually exclusive though, so I'd say we need both. For early-stage startups though, sometimes the challenge is more in actually reaching the stage where there's anything to tax - which is why I still think actually giving them the money in their…
> For early-stage startups though, sometimes the challenge is more in actually reaching the stage where there's anything to tax
Sure, I get that. I live in the startup world too. I just disagree that it's the government's job to take my money and give it to you — and, of course, vice versa: I won't ask the government to take your money and give it to me.
We already have a solution for the problem you bring up. It's called investing. You exchange a percentage of your company for the capital you need to get going. If a startup has trouble convincing an angel investor to part with his money, he may need to revisit his business idea or iterate a bit further. That's a good thing, it helps improve the startup.
But "government money" is really my money, and you're proposing that the government force me to fund startups that have been unable to secure angel investment. To be blunt, this seems really lame. I'd rather keep my money that I've worked hard for and invest it into my own ventures.
[I should also note this is a debate of principles for me: I'm not saying "oh in my opinion startups aren't worth my tax dollars", so much as "government is inefficient at everything, and $PROPOSAL is a subset of everything, therefore, government shouldn't be $PROPOSAL when another solution already exists.", where $PROPOSAL = 'funding startups' in this instance.]
Re: Want to help startups? Just give them money
#7Earlier quoted context omitted.
(The One Direction solution??) I agree that more tax breaks for startups would help and it would be a more straightforward thing to achieve. The two things don't have to be mutually exclusive though, so I'd say we need both. For early-stage startups though, sometimes the challenge is more in actually reaching the stage where there's anything to tax - which is why I still think actually giving them the money in their…
> For early-stage startups though, sometimes the challenge is more in actually reaching the stage where there's anything to tax Sure, I get that. I live in the startup world too. I just disagree that it's the government's job to take my money and give it to you — and, of course, vice versa: I won't ask the government to take your money and give it to me. We already have a solution for the problem you bring up. It's c…
You're right, it's a difference about the principles of the matter and no doubt we disagree over the government's role (especially in an economic downturn). Setting that to one side though, the truth is that the government is spending your tax dollars already and I'm suggesting that there may be a better way for them to do it.
Re: Want to help startups? Just give them money
#8Earlier quoted context omitted.
> For early-stage startups though, sometimes the challenge is more in actually reaching the stage where there's anything to tax Sure, I get that. I live in the startup world too. I just disagree that it's the government's job to take my money and give it to you — and, of course, vice versa: I won't ask the government to take your money and give it to me. We already have a solution for the problem you bring up. It's c…
You're right, it's a difference about the principles of the matter and no doubt we disagree over the government's role (especially in an economic downturn). Setting that to one side though, the truth is that the government is spending your tax dollars already and I'm suggesting that there may be a better way for them to do it.
the government is spending your tax dollars already
They should be spending a lot less of them, shouldn't they?
I mean, what business would ever be allowed to spend money endlessly without thought to income? Why do we let the government do it?
Besides, we already have angel funding, ycombinator, venture capital, self funding, debt funding, crowd funding, etc.
http://www.instigatorblog.com/an-introductory-guide-to-start...
We should not be taking tax money by force from some to fund the next facebook.
Re: Want to help startups? Just give them money
#9This feels like a One More Level of Indirection solution. [1] The problem, I think most everyone agrees, is that the government isn't the greatest at growing businesses. The obvious, delete-all-the-code approach would be to leave more money in the hands of the businesses by lowering taxes. Or, as the article suggests, we could pile on another layer of indirection: encourage the government to keep taking my money, hop…
The obvious, delete-all-the-code approach would be to leave more money in the hands of the businesses by lowering taxes.
I'm a left-libertarian, so what I want to see is a basic income and low levels of regulation. Taxes can be high. I'm fine with that as long as it's spent on useful things (more cancer research, less war). The tax rate we pay in the US is about right. What we get for our taxes is disappointing. We should have universal healthcare, for example. The current system is expensive and doesn't work.
You can tear out a lot of regulations if you have basic income in place. For example, you no longer have to support so many farmers with price floors. If market value for their produce declines, they're still OK; you don't get the cascading effect of rural poverty (1920s) that eventually impoverishes the whole society (1930s).
I also support a flat tax. Morally, I'm okay with the concept of progressive taxation; but if we get our house in order with a basic income and a certain basket of always-provided goods (food, education, housing, and healthcare at affordable prices) then it really doesn't matter that a billionaire is playing 40% instead 70%. He'll, I'd be happy just to see the billionaires pay the percentage that I do!
For example, I hate the concept of minimum wage. Before you conclude that I'm an asshole, hear me out. Without basic income, we absolutely need one. But what is a minimum wage? It's a clumsy basic income that's financed by low-end employers. How do they respond? They cut jobs.
The good of a minimum wage (which, again, is essential if you don't have basic income) is that employers have an incentive to automate the lowest of the low in menial processes. However, you'd still have that incentive with basic income because people just wouldn't do low-yield, unpleasant work for next-to-nothing. Right now, poor people can't get a fair wage because they are fucked if they are jobless, giving employers all the leverage. Basic income allows the market to find a fair value for work.
Re: Want to help startups? Just give them money
#10Good article.
I must say that a unique benefit about Scotland for entrepreneurs is that higher education is free. This reduces the debt burden of a new graduate significantly that helps with any new venture.
I do agree that the money spent on bureaucracy by government bodies that are meant to boost enterprise is wasteful, although the new gov.uk web project suggests that sometimes projects can be done well at a decent price.
I echo nthj's comments in saying that tax breaks are the easiest way to benefit all small enterprises, from tech start ups, to new retail shops, plumbers starting their first business etc.